A recent tribunal hearing ruled that ‘mandatory’ overtime and bonuses should be taken into account when calculating holiday pay.
The ruling has been met with mixed reactions. Many unions and employees support the results of the hearing whilst employers and politicians are concerned about the added financial pressure this will put on businesses. A key concern from employers was individuals making retrospective claims however the ruling has limited this to the last three months which should go some way to minimising the impact for most businesses.
One in six workers in the UK carries out regular overtime, this includes many workers in the construction industry, manufacturing and retail. Employers will now have to consider the hours ‘normally worked’ by their employees when calculating their holiday pay. According to This Is Money up to five million UK workers could now benefit from increased holiday pay.
The good news for recruitment consultants is that if your contractors are employed by a compliant umbrella service all their working hours will already have been taken into account when calculating their holiday pay. This is another reason for agencies to take a careful look at the umbrella companies they are working with and check they are compliant.
If you have any questions or concerns on give your account manager a call to discuss any concerns you may have. Tel 01244 500195
